A/E firms that took Paycheck Protection Program loans to maintain cash flow and alleviate market uncertainties are now considering applying for loan forgiveness under the terms of the Small Business Administration and U.S. Treasury guidelines. But how might PPP loan forgiveness alter the firm’s indirect cost rate on government contracts? How will PPP loan forgiveness be treated under Federal Acquisition Regulations? Will a credit to overhead be required? These are critical questions for firms contracting with federal, state, and local public clients using a FAR-compliant overhead rate.

In addition to PPP loan forgiveness, the economic effect of the pandemic, governmental response actions, and on-going telework conditions in many parts of the country continue to create uncertainties and disrupt engineering firm operations. The resulting impacts on firm overhead rates will be varied and complicated.

In this timely webinar, Monday, September 28, at 1:30 p.m. EDT, two FAR accounting experts will explore these critical issues as firms enter the last quarter of 2020 and look ahead to their annual FAR audit. Participants will get the latest updates on federal guidance and likely accounting treatment of PPP loan forgiveness, including some practical steps they can take now to accommodate for potential outcomes. Firms will also understand how telework and other business practice changes could alter their indirect cost rates, billing, and profitability in 2021 and beyond.

Participants in this session will learn:

• The most up-to-date guidance on treatment of forgiven PPP loans for government contractors;
• Potential accounting scenarios for PPP loans and likely outcomes;
• How to understand and manage the impact of anomalous business conditions on the firm’s overhead rate;
• The latest discussions and next steps in discussions with FHWA, State DOTs, and other key client sectors on potential accommodations.

Presenter: Wayne Owens, T. Wayne Owens & Associates and Scott Sutton at Somerset CPAs & Advisors